Chartered Accountants & Tax Specialist
General update by IBBZ Accounting on latest tax news, business growth and technology tips.
Residential care subsidy:
What is it?
Residential care subsidy is a programme to help people aged 50 and over who need long-term residential care in a rest home or hospital to afford for the cost of care. You may be able to get the Residential Care subsidy if you:
Residential care subsidy is paid directly to your rest home or hospital by the Ministry of Health.
However, there are some asset thresholds that you will have to meet:
There is an asset threshold which limits the maximum asset an applicant can have in order to get the subsidy. From 1 July 2014, people who
The threshold is adjusted at 1 July each year.
For the asset, they count include:
Therefore, although your assets are locked under a trust, it is still considered as your assets for the Residential Care Subsidy purpose.
If you give away assets, they still may be counted as assets in your financial means assessment. The social security system operates on the principle that people should look to their own resources first before seeking assistance from the state. Under the Act, all resources are required to be used to help the client support themselves. This approach did not change with the abolition of gift duty.
However, you can gift up to $6,000 within a 12 month period in each of the five years before you apply. This applies to each application for the Residential Care Subsidy.
Gifts of more than $27,000 per year, per application (for couples application too) made before the five year gifting period, may be added into the assessment.
Information provided above is of general use only. If you intending to rely on above information consult us or seek professional advice. IBBZ Accounting or any of its employee is not responsible should the information above result in any kind of loss to you directly or indirectly.